Aubrey McClendonhttp://www.businessinsider.com/category/aubrey-mcclendon
en-usFri, 09 Dec 2016 10:27:13 -0500Fri, 09 Dec 2016 10:27:13 -0500The latest news on Aubrey McClendon from Business Insiderhttp://static3.businessinsider.com/assets/images/bilogo-250x36-wide-rev.pngBusiness Insiderhttp://www.businessinsider.com
http://www.businessinsider.com/aubrey-mcclendon-probate-oklahoma-city-thunder-2016-5The case of a dead oil and gas mogul takes an unexpected turn, and it involves the Oklahoma City Thunderhttp://www.businessinsider.com/aubrey-mcclendon-probate-oklahoma-city-thunder-2016-5
Sat, 28 May 2016 00:02:37 -0400Jessica DiNapoli
<p><img style="float:right;" src="http://static3.businessinsider.com/image/574917479105841c008c5a3e-2400/2016-05-28t005654z_3_lynxnpec4q1dv_rtroptp_4_nba.jpg" alt="Oklahoma City Thunder" data-mce-source="Kelley L Cox-USA TODAY Sports" data-mce-caption="Oklahoma City Thunder Russell Westbrook dribbles as Golden State Warriors Stephen Curry defends in game five." /></p><p>NEW YORK (Reuters) - This weekend, the Oklahoma City Thunder stands one game away from clinching a surprising spot in the NBA finals.</p>
<p>But away from the roar of fans and the glare of cameras, another battle involving the basketball team is brewing in a probate courtroom in its home city.</p>
<p>At stake is a roughly 20 percent interest in the Thunder held by Aubrey McClendon, the indebted Oklahoma energy magnate who died in a car crash on March 2.</p>
<p>Some of McClendon's creditors want a say over how the stake will be disposed of by his estate, viewing the basketball team as one of his few assets of value, according to a copy of a transcript from a May 13 hearing in probate court.</p>
<p>The lenders want the stake to be sold for top dollar but fear it will be sold for less than that to McClendon's wife, Kathleen, because she is family, said a lawyer representing a syndicate of banks led by Wilmington Trust that loaned $465 million to a company McClendon founded in 2013, American Energy Partners LP (AEP).&nbsp;</p>
<p>"We have been advised that Katie McClendon wants to purchase that Thunder interest," said the attorney, Arthur Hoge, in the court transcript reviewed by Reuters.</p>
<p>"If we have a reason to question a sale, because we don't think it's an arm's length fair market value sale ... we should have the right to come address that with the court," he said.&nbsp;</p>
<p>Attorneys for McClendon's estate said the creditors were getting ahead of themselves and should not yet be intervening in the probate process. They said the interest in the Thunder was not for sale at this stage, and any sale would need to satisfy qualifications set by the National Basketball Association.</p>
<p>"We certainly don't want the creditors to think we're going to overreach them, but the assertion that we could sell the Thunder interest without letting you know is absurd," Martin Stringer, an attorney for the estate, said in the transcript.</p>
<p>Hoge did not give a value for the Thunder stake at the probate hearing. When reached by Reuters, he declined to comment beyond what was in the public record.&nbsp;</p>
<p>Forbes valued the Thunder at $950 million in January. Reuters was unable to verify that valuation.&nbsp;</p>
<p>Stringer and an attorney for Kathleen McClendon did not return requests for comment.&nbsp;</p>
<p><img src="http://static4.businessinsider.com/image/5749179891058436008c5b61-800/2016-05-28t005654z_2_lynxnpec4q1fg_rtroptp_3_nba.jpg" alt="Aubrey McClendon Oklahoma City Thunder" data-mce-source="REUTERS/Mike Stone" data-mce-caption="Aubrey McClendon cheers during Game 1 of the NBA finals against the Miami Heat in Oklahoma City, June 12, 2012." /></p>
<h2>Battle looms</h2>
<p>McClendon cofounded Chesapeake Energy in 1989 and turned it into the second-largest natural gas driller in the United States before he stepped down as chief executive in 2013.</p>
<p>The U.S. fracking pioneer left behind a web of business interests made up of more than 180 limited liability companies, partnerships and corporations. Low oil and gas prices have pressured the value of many of his assets.</p>
<p>The lenders that bankrolled some of McClendon's oil and gas businesses said in probate court that they believe his estate is likely insolvent. Besides the $3 million McClendon had in a cash account, the Thunder stake may be his most valuable asset, they said.&nbsp;</p>
<p>Attorneys for McClendon's estate said the creditors' assertion that the estate was insolvent was "just incorrect."</p>
<p>"It depends on commodity prices," among other factors, Stringer said in the transcript.</p>
<p>The fight over the Thunder stake sets the stage for a highly complex and contentious probate proceeding. Hoge compared it to a bankruptcy, where the court's chief role is to protect the interest of creditors. He said Wilmington Trust was the most significant creditor in the case.&nbsp;</p>
<p>"This is a most unusual estate," said judge Richard Kirby, according to the transcript.</p>
<p>The banks that originally backed the $465 million loan to AEP, personally guaranteed by McClendon, include Goldman Sachs, Jefferies &amp; Co, Morgan Stanley and Credit Suisse, according to Thomson Reuters data. Representatives for these banks declined to comment.</p>
<p>Before McClendon, 56, died he had been forced by financial pressures to part with some of his oil and gas interests, one of his best sources of cash. His biggest investor was abandoning him and he had just agreed to settle a legal claim that chipped at his reputation, Reuters reported in March.</p>
<p>McClendon had used his interest in the Thunder to personally guarantee a loan from private investment firm Oaktree Capital Management LP to a subsidiary of AEP, according to a person familiar with the matter.&nbsp;</p>
<p>Beyond the Thunder stake and the minority interests in the AEP spin-off companies, the identities of many of the other assets are not publicly known because the probate court granted the estate a waiver on inventorying and valuing them, according to court records.</p>
<p>The attorneys for McClendon's estate argued that making the assets public now could hurt the estate, according to the court transcript.</p>
<p><img src="http://static3.businessinsider.com/image/574917d191058422008c5872-800/2016-05-28t005654z_2_lynxnpec4q1fd_rtroptp_3_nba.jpg" alt="Aubrey McClendon Oklahoma City Thunder" data-mce-source="REUTERS/Bill Waugh" data-mce-caption="Aubrey McClendon (C) in the finals seconds against the Los Angeles Lakers in Game 3 of their Western Conference playoff series in Oklahoma City, April 22, 2010." /></p>
<h2>Thunder roils</h2>
<p>McClendon worked on revitalizing Oklahoma City over the last decade, helping bring the NBA team to the city from Seattle in 2008. The Thunder has thrived in Oklahoma, nearly tripling in value since 2012, <a href="http://reut.rs/1QUfnHp">according to Forbes</a>.</p>
<p>Clayton Bennett, a close friend of McClendon, is the chairman of the Professional Basketball Club LLC, which owns the Thunder. McClendon owned about 20 percent of the LLC.&nbsp;</p>
<p>Bennett and the NBA did not immediately return requests for comment. A spokesman for the Thunder, Dan Mahoney, declined to comment.</p>
<p>Tom Blalock, chief legal officer of AEP, is the executor of McClendon's estate after both McClendon's wife and Scott Mueller, chief financial officer of AEP, passed on the job.</p>
<p>Hoge said Blalock's two roles could be a potential conflict of interest. One of Blalock's attorneys, Stringer, said he would go before the court to resolve any conflicts, according to the transcript. Blalock could not be reached for comment.</p>
<p>AEP did not return a request for comment. The company, founded by McClendon after he left Chesapeake, announced its plans to close this month. AEP is working with restructuring attorneys.</p>
<p>The bank group led by Wilmington Trust has also hired restructuring attorneys and is working with financial advisors. The group recently demanded immediate repayment of the $465 million loan, according to people familiar with the matter. Under the terms of the loan, his death represented a default.&nbsp;</p>
<p>Wilmington Trust did not return a request for comment.</p>
<p>The move to accelerate the loan allows the group to file a claim against McClendon's estate, according to a person familiar with the matter. After a noticing period, the probate court will accept claims from creditors detailing what the estate owes them.</p>
<p>Stringer and the other attorneys for the estate have bristled at the intervention of the creditors in the probate court.</p>
<p>"We recognize that there's a lot of money owed potentially out there. But creditors have specific times they can come into a probate," said Mark Malone, an attorney for the estate, according to the transcript. "I don't say this with my club to say, 'We hate you and go away.' It is more ... we need to be able to do what we need to be able to do."</p>
<p>(Additional reporting by Joshua Schneyer in New York and Terry Wade in Houston; Editing by Carmel Crimmins and Tiffany Wu)</p><p><a href="http://www.businessinsider.com/aubrey-mcclendon-probate-oklahoma-city-thunder-2016-5#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/nba-putting-ads-jerseys-logo-corporate-2016-4">NBA owners have just agreed to put ads on jerseys</a></p> http://www.businessinsider.com/r-special-report-the-final-days-and-deals-of-aubrey-mcclendon-2016-3The final days and last deals of oil legend Aubrey McClendonhttp://www.businessinsider.com/r-special-report-the-final-days-and-deals-of-aubrey-mcclendon-2016-3
Fri, 11 Mar 2016 16:29:00 -0500John Shiffman, Brian Grow and Michael Flaherty
<p><img style="float:right;" src="http://static3.businessinsider.com/image/56e3372c91058428008b5ec3-2699-2024/rtr2zz5r.jpg" alt="Aubrey McClendon" data-mce-source="REUTERS/Sean Gardner" data-link="http://pictures.reuters.com/C.aspx?VP3=SearchResult&amp;VBID=2C0FCIXTZCVGH&amp;SMLS=1&amp;RW=1528&amp;RH=958#/SearchResult&amp;VBID=2C0FCIXTZCVGH&amp;SMLS=1&amp;RW=1528&amp;RH=958&amp;POPUPPN=25&amp;POPUPIID=2C04080640V7P" /></p><p>OKLAHOMA CITY (Reuters) - The night before Aubrey McClendon died, the oil-and-gas pioneer was expected at a private dinner here with potential business partners. Among them: Vicente Fox, the former president of Mexico.</p>
<p>Around sunset, the group gathered in a wood-paneled dining room at the exclusive Beacon Club. A waiter brought plates of sea bass and lamb. Three bottles from McClendon&rsquo;s wine collection were opened, including a 2010 Napa Valley red bearing the logo of his business, American Energy Partners.</p>
<p>But McClendon, who reveled in his reputation as the life of the party, never showed, said four people who were there.</p>
<p>The group soon learned why. U.S. prosecutors had just announced McClendon&rsquo;s indictment for allegedly conspiring with a competitor to suppress land prices by rigging bids while leading his former company, Chesapeake Energy. People at the dinner said McClendon sent an emissary and his regrets. Fox and others signed the empty wine bottles, intending to present them to McClendon the next day.</p>
<p>They never had the chance.</p>
<p>McClendon died the following morning, March 2, when his car crashed at high speed into an overpass wall along a two-lane road here. The accident remains under investigation</p>
<p>The <a href="http://reut.rs/1QUfnHp">sudden end to his lavish and leveraged life</a> came as McClendon, 56, confronted challenges more consequential than any he had faced before. He&rsquo;d been forced to part with oil and gas-well interests, one of his best sources of cash. His biggest investor was abandoning him. He had just agreed to settle a legal claim that chipped at his reputation. And now, with the indictment, a protracted legal battle for his personal freedom loomed.</p>
<p>A Reuters review of records and interviews show:</p>
<p style="padding-left: 30px;">* McClendon no longer controlled the bulk of his most bankable venture, the one that helped make him a billionaire while he was CEO of Chesapeake: his stake in thousands of company oil and gas wells awarded to him during his tenure. Records show he was in the process of transferring the last of these interests to a company controlled by a close friend, Clayton Bennett of Dorchester Capital.</p>
<p style="padding-left: 30px;">* His largest investor was halting all new business with him. The backer, Energy &amp; Minerals Group of Houston, informed its investors just before his death that McClendon no longer held any leadership roles in related firms.</p>
<p style="padding-left: 30px;">* McClendon had recently reached an undisclosed, tentative agreement to pay at least $3 million to Chesapeake to settle a legal dispute in which his former company had accused him of taking confidential data with him when he left in 2013 to set up his new company.</p>
<p style="padding-left: 30px;">* By fighting the U.S. criminal indictment, he faced a potential public airing of his business tactics. McClendon&rsquo;s own emails were expected to represent the bulk of the government&rsquo;s evidence against him, say two people familiar with the matter.</p>
<p>As authorities try to determine what caused the fatal crash, those who knew McClendon are also searching for answers. The Aubrey they knew had a reputation for overspending on land leases, not conspiring to keep prices low. They say he was an eternal optimist, a visionary who helped revolutionize an industry and shape the city he called home.</p>
<p>The Aubrey McClendon who was expected at the Beacon Club dinner hadn&rsquo;t simply weathered passing storms. Often, he had tamed them.</p>
<h2>High-level Justice meetings</h2>
<p>McClendon knew he was under criminal investigation: AEP disclosed in a filing last year with U.S. securities regulators that the Justice Department was investigating him over the potential antitrust violations. His former company, Chesapeake, has been cooperating with authorities in return for "conditional leniency" from the Justice Department. As a result, Chesapeake has said, the company did not expect to face prosecution or penalties.</p>
<p>But the indictment caught McClendon off guard, according to people familiar with the matter.</p>
<p>His legal team had met with senior Justice Department prosecutors three times in late 2015 to try to persuade them not to indict McClendon, a person familiar with the matter said. McClendon had been expecting a response; instead, he was indicted without warning, the person said.</p>
<p>Reflecting the gravity of the probe, last fall McClendon hired famed trial attorney Abbe Lowell, who has represented politicians, lobbyists and entertainers in trouble. Among his past clients: former U.S. presidential candidate John Edwards and rap star Sean &ldquo;Diddy&rdquo; Combs. Lowell was chief counsel for the defense during President Bill Clinton&rsquo;s impeachment trial in the U.S. Senate.</p>
<p>In December, McClendon&rsquo;s lawyers gave a PowerPoint presentation to Assistant Attorney General Bill Baer at the Justice Department in Washington, two people familiar with the matter said.</p>
<p>Lowell told Baer that McClendon&rsquo;s prosecution would be a first of its kind in the oil and gas industry, said a person familiar with the exchange. Lowell argued that cooperation in the industry through joint bidding ventures is common and perfectly legal. An indictment, he told the Justice officials, would mark an unfair application of criminal antitrust laws to the sector.</p>
<p>Part of the discussion focused on emails between McClendon and former SandRidge Energy chief executive Tom Ward, in which the two longtime friends discussed coordinating bids on energy acreage. The emails relate to a handful of deals the two men discussed among many innocuous transactions, two people familiar with the matter said.</p>
<p>Ward, who co-founded Chesapeake with McClendon and left to run SandRidge in 2006, was not named in the U.S. indictment against his old friend. But people familiar with the case said he is the person referred to in the indictment as McClendon&rsquo;s unidentified alleged co-conspirator.</p>
<p>The indictment alleged that McClendon and the co-conspirator agreed not to bid against each other for certain parcels of land in northwest Oklahoma in order to keep prices down. In return, each party would receive a share of the property later.</p>
<p>Lawyers haggled over the intent of the messages between the two men, with McClendon&rsquo;s side arguing that what some people might consider a conspiratorial tone could instead be read as two professionals trying to work out a legitimate agreement to efficiently develop an area through joint ventures.</p>
<p>A person familiar with the investigation countered that assertion, saying the emails between McClendon and Ward &ldquo;are direct as they can possibly be.&rdquo; Though the indictment doesn&rsquo;t cite specific evidence, it alleges that the two men consummated the proposed rigging of bids.</p>
<p>Ward hasn&rsquo;t been charged with any wrongdoing. Spokesmen for Ward&rsquo;s new company, Tapstone Energy, and for Chesapeake did not return calls for comment. SandRidge and a Justice Department official declined to comment. AEP&rsquo;s chief legal officer, Tom Blalock, did not respond to requests for comment.</p>
<p>During the Justice Department meeting, a person familiar with the discussion said, McClendon&rsquo;s lawyers also argued that his contributions to the city, state and national economy should be taken into account. They expressed concern about the harm an indictment might cause to AEP, SandRidge, their employees, the Oklahoma City community and the natural gas industry. Baer asked questions, two sources said, and requested more information.</p>
<p>The day after McClendon died, prosecutors filed a motion to dismiss the indictment. But officials said their investigation of potential antitrust violations in the oil and gas industry is continuing.</p>
<h2>Questions in Oklahoma</h2>
<p>McClendon is credited and sometimes cursed for championing the drilling technique known as hydraulic fracturing, or fracking. The technology led to a boom in U.S. oil and natural gas production from porous rock formations, known as shale, that had been hard to tap. And fracking made him a billionaire. By 2005, Chesapeake was the second-largest U.S. natural gas producer, after Exxon Mobil.</p>
<p>In 2012, Reuters reported in a series of articles that McClendon enjoyed controversial perks at shareholder expense, operated a secretive, $200 million hedge fund from inside Chesapeake&rsquo;s offices, and received as much as $1.4 billion in loans against his well interests. In response to the news, his board stripped him of his chairmanship, and he resigned in 2013 to start AEP.</p>
<p>Some energy executives who did business with McClendon say they are puzzled by the charge that he conspired to suppress land prices. Brandt Temple, CEO of Sunrise Exploration in New Orleans, is one of them. Temple was negotiating a deal with McClendon that was supposed to close the day of the deadly crash.</p>
<p>&ldquo;What he was indicted for, which is keeping prices down, that&rsquo;s typically never what he did,&rdquo; Temple said. &ldquo;With my experience with Aubrey&hellip;, he was doing it the other way,&rdquo; paying as much as $1,000 per acre for land others valued at $300.</p>
<p>Temple&rsquo;s view was echoed by others in the industry. But emails published by Reuters in 2012 showed that McClendon had indeed tried to suppress land prices elsewhere. In one, McClendon wrote to a rival energy executive that it was time "to smoke a peace pipe" together "if we are bidding each other up." In another, he wrote: &ldquo;Should we throw in 50/50 together here rather than trying to bash each other&rsquo;s brains out on lease buying?&rdquo;</p>
<p>The Michigan Attorney General investigated, and last year Chesapeake settled criminal antitrust, fraud and racketeering charges, paying $25 million to a victims fund. Chesapeake pleaded no contest to one count each of attempted antitrust violation and false pretenses, both misdemeanors.</p>
<h2>Flags at half-staff</h2>
<p>McClendon had a deep impact on Oklahoma City in the years he ran Chesapeake. He created tens of thousands of jobs and showered tens of millions of Chesapeake&rsquo;s and his own dollars on the community. He helped bring the NBA&rsquo;s Oklahoma City Thunder and an Olympic-class rowing venue to town. He secured the city&rsquo;s first Whole Foods Market, brought upscale shopping and dining to the Chesapeake neighborhood and contributed to many charities, from local elementary schools to Boy &amp; Girls Clubs.</p>
<p>&ldquo;When Aubrey left Chesapeake, there was an audible gasp from the nonprofit community in this city,&rdquo; former governor Frank Keating, a past Chesapeake board member, said at the funeral</p>
<p>In the March 2 edition of the hometown paper, The Oklahoman, McClendon&rsquo;s indictment was played bigger than surprising results in the previous day&rsquo;s Super Tuesday U.S. presidential nominating contest, featuring upset wins by Senators Ted Cruz and Bernie Sanders.</p>
<p>His death dominated the next day&rsquo;s front page and accounted for almost four full pages inside. A columnist wrote that if Oklahoma City ever chisels its own Mount Rushmore, &ldquo;Aubrey is on it.&rdquo;</p>
<p>For nearly a week following his death, flags flew at half staff at banks, churches and energy businesses. Stores near the Chesapeake campus closed so employees could attend the funeral, which was held in a mega-church and drew a standing-room crowd of more than 3,000</p>
<p>Several hundred mourners also attended a sunrise memorial Saturday. They included Brant Briggs, an usher at Chesapeake Arena, who served McClendon and his old friend and fellow Thunder owner, Bennett, in their side-by-side front-row seats. &ldquo;He had such a kind, generous heart,&rdquo; Briggs said. &ldquo;He will be missed by so many people.&rdquo; The Thunder honored McClendon with a pregame ceremony this Wednesday that included video from his introduction into the Oklahoma Hall of Fame.</p>
<p>McClendon&rsquo;s style wasn&rsquo;t for everyone, acknowledged his friend and former Chesapeake executive Mike Stice, who attended the dinner at the Beacon Club the night of the indictment.</p>
<p>&ldquo;He was a risk taker beyond most people&rsquo;s comfort level,&rdquo; Stice said.</p>
<p>Many people in Oklahoma are talking about the possibility that the car crash wasn&rsquo;t an accident - that a despondent McClendon may have taken his own life. His family hasn&rsquo;t commented on this talk, but at his funeral, his children spoke of his sunny optimism. Other people close to him dismissed the idea of suicide, saying the man they knew projected a positive, seize-the-day attitude.</p>
<p>They also noted that he&rsquo;d withstood adversity before. In 2012, after the Chesapeake removed him as chairman, he bucked up employees at a town-hall-style meeting, according to a recording.</p>
<p>&ldquo;It ends by winning, at the end of the day, delivering on what you are doing, what you believe in and what you will continue to do,&rdquo; he told the staff. &ldquo;You just have to outlast it.&rdquo;</p>
<p>Tom Price, who worked for McClendon for more than 20 years, described him as &ldquo;the toughest guy I ever met. The notion that Aubrey in any way, shape or form (might) bring his life to an end voluntarily is insane.&rdquo;</p>
<p>Several friends in Oklahoma City noted that McClendon had recently become a grandfather. As was his custom, every morning he sent AEP employees a quote of the day. On the day his grandchild was born, he wrote, &ldquo;A baby is God&rsquo;s opinion that life should go on.&rdquo;</p>
<h2>Cash crunch</h2>
<p>The indictment says the bid-rigging conspiracy started on Dec. 27, 2007, a time when the energy tycoon&rsquo;s career was about to accelerate. Chesapeake&rsquo;s share price closed at $39.12 that day, on its way to an all-time high of $69.40 six months later. The company was amassing drilling rights that would grow to more than 14 million acres, nearly the size of West Virginia.</p>
<p>In the first year of the alleged criminal conspiracy in Oklahoma, Forbes magazine put McClendon&rsquo;s net worth at $3 billion. In 2012, he dropped off the Forbes 400 list of richest Americans. The magazine's new estimate: McClendon had a net worth of $500 million.</p>
<p>As oil and gas prices tumbled over the past 18 months, eroding his wealth, McClendon scrambled to raise cash.</p>
<p>In the month before he died, for example, McClendon asked close friends and family members from whom he&rsquo;d raised money before if they would like to invest again, two people familiar with the situation said. One of these people had participated in an investment round with individual buy-ins of between $50,000 and $100,000 for energy assets in the so-called Utica shale formation in the U.S. Northeast. The person said he turned down the offer this time because he had lost his job in the oil and gas bust.</p>
<p>In late October, property records and creditor filings show, McClendon staked many of his personal assets as collateral for loans - including his 19 percent stake in the NBA team, property in Oklahoma and Connecticut, antique boats and investments in privately held companies. Some assets had previously been pledged as collateral to other lenders.</p>
<p>McClendon was dipping into his depleted assets to prop up AEP, his new company. Records filed in Oklahoma County Court show that McClendon and an AEP unit called Scoop Energy put up collateral for a loan to Scoop from investor Oaktree Capital. McClendon was personally guaranteeing the loan to Scoop, according to a person familiar with the matter. Oaktree declined to comment.</p>
<p>Another foundation of McClendon's wealth was under pressure. For many years, he was able to raise cash thanks to an unusual incentive he enjoyed from Chesapeake. The perk, known as the Founder Well Participation Plan, granted McClendon up to a 2.5 percent stake in every well drilled by Chesapeake during his 24-year tenure.</p>
<p>When McClendon left Chesapeake in April 2013, he held onto his well interests through four companies he controlled. As Reuters reported in 2012, mortgage records show that McClendon had borrowed as much as $1.4 billion through those companies by pledging the Chesapeake well interests as collateral.</p>
<p>But as oil and gas prices fell, the cost of operating the wells began exceeding the returns McClendon got from the hydrocarbons they produced. Unable to keep up, he eventually lost control of three of the firms - and thus of any future cash they would generate. Control passed to one of his lenders, EIG Global Energy Partners, a Washington, DC-based private equity firm, Oklahoma County records show. A spokesman for EIG declined to comment.</p>
<p>He gave up another juicy holding last year, the filings show. Arcadia Resources, McClendon's oldest means of financing his Chesapeake well interests, transferred its assets to Dorchester Resources, controlled by Bennett, his close friend. Bennett did not return a request for comment.</p>
<p>Another setback hit McClendon the morning that he died - the announcement by EMG that it would cease new investments. This was a major blow: EMG had invested $3 billion with McClendon. Now the $17 billion fund was done with him.</p>
<p>In a letter sent hours before the crash, EMG informed its investors that, as of Feb. 26, McClendon was no longer the CEO or a board member of any EMG portfolio company. The letter also pointed to concerns about McClendon&rsquo;s indictment.</p>
<p>&ldquo;These are serious allegations that have been made against McClendon (and could have equally serious implications across the industry) and EMG takes this matter very seriously,&rdquo; managing partner John Raymond wrote.</p>
<p>An EMG spokeswoman did not respond to requests for comment.</p>
<p>It&rsquo;s unclear whether McClendon had been informed of the letter&rsquo;s content before it went out. But the end of McClendon&rsquo;s collaboration with EMG removed one of his main sources of capital to find and develop land.</p>
<p>McClendon faced at least one more looming debt.</p>
<p>According to three people familiar with the matter, he had tentatively agreed to settle a claim by Chesapeake alleging that he took confidential oil-and-gas-related data with him when he left the company and used the information when he started AEP. AEP has called the claim &ldquo;meritless.&rdquo; McClendon too had denied the accusation, and the case was about to be resolved in arbitration. The sources said McClendon, as founder and principal of AEP, had recently agreed to pay Chesapeake more than $3 million.</p>
<h2>'We may never know'</h2>
<p>When the Justice Department announced the indictment March 1, it also issued a statement strongly critical of McClendon.</p>
<p>&ldquo;Executives who abuse their positions as leaders of major corporations to organize criminal activity must be held accountable for their actions,&rdquo; wrote Baer, the Assistant Attorney General.</p>
<p>McClendon skipped the Beacon Club dinner and issued a response that evening. He called the single conspiracy count against him &ldquo;wrong and unprecedented.&rdquo; He added, &ldquo;I will fight to prove my innocence and to clear my name.&rdquo;</p>
<p>He was still working close to midnight, a person familiar with the matter said.</p>
<p>McClendon&rsquo;s movements the next morning could not be confirmed. Three people who received emails from him said the messages revealed nothing amiss.</p>
<p>&ldquo;He was unfazed,&rdquo; said one recipient, Franco Hamdan of EIM Capital, who'd attended the Beacon Club dinner the night before as the business partner of former Mexican President Fox. &ldquo;He was determined and well on his way to make a global shale revolution in Australia, Mexico and Argentina.&rdquo;</p>
<p>Shortly after 9 a.m., McClendon drove his Chevy Tahoe north along Midwest Boulevard, a two-lane country road. He likely knew the route well: It is a scenic route from AEP&rsquo;s offices to McClendon&rsquo;s tree farm and Pops, a soda-and-burger joint he opened beside a futuristic gas station on Route 66.</p>
<p>&ldquo;He loved navigating back roads,&rdquo; son Will McClendon said at the funeral. &ldquo;He was definitely not a Google Maps kind of guy.&rdquo;</p>
<p>McClendon was also known for driving fast and without a seat belt.</p>
<p>Beneath a bridge for Interstate 44, Midwest Boulevard narrows slightly. Police have said McClendon was speeding as he approached the bridge, well in excess of the 50 mph limit. His SUV crossed the yellow dividing line and directly hit the western bridge support. Dispatchers took the first in a series of emergency calls at 9:12 a.m.</p>
<p>&ldquo;It looks like a Tahoe and it looks pretty rough...&rdquo;</p>
<p>&ldquo;The cab is completely crushed...&rdquo;</p>
<p>&ldquo;That vehicle just exploded&hellip;.&rdquo;</p>
<p>Oklahoma City authorities have said McClendon likely died instantly from the collision. Authorities said they intend to release a full report on the accident next week.</p>
<p>&ldquo;As to his state of mind, we know how it happened, but not why it happened,&rdquo; said Oklahoma City Police Captain Paco Balderrama. &ldquo;Someone under so much pressure: Maybe he didn&rsquo;t get enough sleep. Is it possible he dozed off? It is possible he suffered a medical emergency? Why did it happen? We may never know.&rdquo;</p>
<h2>Final deal</h2>
<p>McClendon&rsquo;s security team at AEP called police at about 10 a.m. to report him missing.</p>
<p>A short while later, Temple, the New Orleans energy executive, checked his bank account online, expecting to see a payment. AEP and McClendon had agreed to buy mineral rights in Oklahoma from Temple&rsquo;s Sunrise Exploration for an undisclosed amount. The deal was scheduled to close at noon.</p>
<p>Noon came and went. No payment.</p>
<p>Suddenly, Temple recalled, emails flooded in. Before he could read them, he answered a call from a childhood friend.</p>
<p>&ldquo;Did you see what happened to Aubrey?&rdquo;</p>
<p>&ldquo;Yeah,&rdquo; Temple said. &ldquo;He got indicted.&rdquo;</p>
<p>&ldquo;No, he&rsquo;s dead.&rdquo;</p>
<p>Temple said he felt goose bumps, then sadness.</p>
<p>The next day, the money came through. AEP had honored what may have been Aubrey McClendon&rsquo;s final deal.<br /><br /></p>
<p>(Reporting by John Shiffman, Luc Cohen and Heide Brandes in Oklahoma City, Brian Grow in Atlanta, Joshua Schneyer in Los Angeles, Ernest Scheyder, Liz Hampton and Terry Wade in Houston and Michael Flaherty, Michael Erman, Jessica Resnick-Ault, and Mike Stone in New York.; Edited by Blake Morrison and Michael Williams.)</p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3" >Aubrey McClendon’s fracking legacy — the good, the bad, the ugly</a></strong></p>
<p><a href="http://www.businessinsider.com/r-special-report-the-final-days-and-deals-of-aubrey-mcclendon-2016-3#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/map-major-us-oil-gas-energy-pipelines-2015-12">Animated map shows all the major oil and gas pipelines in the US </a></p> http://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3The story of how Aubrey McClendon turned a small fracking enterprise into a major force in American energyhttp://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3
Sat, 05 Mar 2016 12:00:00 -0500Tanya Lewis
<p><img style="float:right;" src="http://static5.businessinsider.com/image/56d744606e97c625048bb04b-729-547/former-chesapeake-ceo-mcclendon-charged-with-bid-rigging-of-land-leases-2016-3.jpg" alt="Aubrey McClendon walks through the French Quarter in New Orleans, Louisiana March 26, 2012. REUTERS/Sean Gardner " data-mce-source="Thomson Reuters" data-mce-caption="CEO, Chairman, and Co-founder of Chesapeake Energy Corporation McClendon walks through the French Quarter in New Orleans, Louisiana" /></p><p>Energy pioneer Aubrey McClendon <a href="http://www.businessinsider.com/former-chesapeake-ceo-aubrey-mcclendon-has-died-in-a-car-accident-2016-3">died in a car crash</a>&nbsp;just a day after he was indicted on conspiracy to rig bids for oil and natural gas leases.</p>
<p>The former Chesapeake Energy CEO rose to prominence by pioneering production techniques that unlocked America's supply of shale gas, which helped wean the country from its reliance on foreign oil.</p>
<p>His indictment came on the heels of a four-year federal antitrust investigation which found that&nbsp;his company had planned to rig the price of land leases in&nbsp;Oklahoma, <a href="http://www.reuters.com/article/us-chesapeake-enrgy-mcclendon-idUSKCN0W42ME">Reuters reports</a>.</p>
<p>While McClendon's own life was cut short, he left a legacy that will shape American energy policy&nbsp;&mdash; for better or for worse &mdash;&nbsp;for years to come.</p>
<p>His company, Chesapeake Energy, pioneered the use of oil and natural gas locked up in shale rock, a technique commonly known as hydraulic fracturing, or fracking. The technique allowed America to unlock decades' worth of energy, but has also been linked to serious environmental and health concerns.</p>
<h2>Fracking: The good, the bad, and the ugly</h2>
<p><img src="http://static1.businessinsider.com/image/56a29b9b58c32319008b48b0-2000-1333/505882540.jpg" alt="fracking crude oil" data-mce-source="Spencer Platt/Getty" data-mce-caption="ANDREWS, TX - JANUARY 20: An oil pumpjack works at dawn in the Permian Basin oil field on January 20, 2016 in the oil town of Andrews, Texas. Despite recent drops in the price of oil, many residents of Andrews, and similar towns across the Permian, are trying to take the long view and stay optimistic. The Dow Jones industrial average plunged 540 points on Wednesday after crude oil plummeted another 7% and crashed below $27 a barrel" />Fracking involves the injection of fracking fluid &mdash; consisting of pressurized water, sand or other ceramic materials, and thickening agents &mdash; into a hole drilled in the ground. This produces cracks in the shale rock that allow oil and natural gas to flow more easily.</p>
<p>The <a href="http://www.kgs.ku.edu/Publications/PIC/pic32.html">first fracking experiment</a>&nbsp;took place&nbsp;in 1947&nbsp;in the Hugoton gas field in Grant County, Kansas. One thousand gallons of napalm and sand from the Arkansas River were injected into a limestone rock&nbsp;formation that was clogged by mud from drilling operations. The attempt&nbsp;wasn't very successful, but&nbsp;the technology has advanced significantly since then.</p>
<p>Today, the <a href="http://www.kgs.ku.edu/PRS/Fracturing/Frac_Paper_SPE_152596.pdf">Society of Petroleum Engineers estimates</a>&nbsp;that 2.5 million&nbsp;fractures have been pumped worldwide over the last 60 years; more than a million of them have been&nbsp;in the US. The technique has unlocked large sources of energy that would otherwise be inaccessible. For example, the Marcellus Shale in western New York, Pennsylvania, and Ohio, is thought to contain enough natural gas to supply the United States <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3076392/">for more than 40 years</a>.</p>
<p>But fracking is incredibly&nbsp;controversial. Opponents say it can release harmful chemicals that <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1817691/">contaminate air and water supplies</a>, possibly <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC4143789/">trigger earthquakes</a>, and <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3076392/">cause human health problems</a>.</p>
<p><span>While scientists are just beginning to study the effects of fracking on the environment, some evidence suggests it can be done safely.&nbsp;</span><span>As <a href="http://www.scientificamerican.com/article/can-fracking-be-done-without-impacting-water/">Scientific American reported</a> in 2013, a <a href="http://science.sciencemag.org/content/340/6134/1235009.abstract">study</a> funded by the National Science Foundation and published in the journal Science found that fracking has "no irrefutable impact" on ground water quality.</span></p>
<p><span>The problem is, it's not always done safely. If the cement casing that surrounds a fracking well is made incorrectly, natural&nbsp;gas can leak along its sides or through cracks, releasing harmful gases like methane to the environment. Methane is one of the most potent greenhouse gases, which trap heat in the atmosphere and exacerbate&nbsp;climate change.</span></p>
<p><span>Another problem is the wastewater from these wells, which can contain&nbsp;toxic or even radioactive chemicals.&nbsp;The same NSF study found that fracking&nbsp;wastewater is already starting to contaminate rivers and other major waterways.</span></p>
<p>A number of countries and states <a href="http://keeptapwatersafe.org/global-bans-on-fracking/">have banned fracking</a>, but it continues to be a major source of American energy.</p>
<h2>McClendon's rise and fall</h2>
<p>Under McClendon, Chesapeake Energy grew from a small operation into the second-biggest natural gas producer in the United States, exceeded only by Exxon Mobil, according to <a href="http://www.nytimes.com/2016/03/03/business/energy-environment/aubrey-mcclendon-56-shale-gas-baron-dies-in-crash-a-day-after-indictment.html?emc=edit_th_20160303&amp;nl=todaysheadlines&amp;nlid=57415309">The New York Times</a>. With Wall Street backing, the company leased land all over the country for fracking, including Texas, Oklahoma, Ohio and Pennsylvania.</p>
<p><img style="float:right;" src="http://static2.businessinsider.com/image/4efb9371ecad04a665000007-400-300/chesapeake-1.jpg" alt="chesapeake silhouette" data-mce-source="Chesapeake Energy Corp" data-link="http://www.chk.com/Media/Photos/Pages/default.aspx" />As the Times reports, they produced so much energy that natural gas prices collapsed, and Chesapeake's shares tanked. McClendon also used his investments in the company to shore up as much as $1.1 billion in loans to pay off the cost of drilling the fracking wells, and he was later forced out of the company.</p>
<p>On Tuesday, the Justice Department indicted McClendon in a conspiracy in which two unnamed companies agreed not to bid against each other for oil and gas leases in northwest Oklahoma between late 2007 and early 2012, a charge he denied.</p>
<p>McClendon died in a car crash less than 24 hours later. Investigators have not yet determined the cause of death.</p>
<p>"He was a major player in leading the stunning energy renaissance in America," Texas energy investor T. Boone Pickens said <a href="http://www.boonepickens.com/2016/03/statement-from-t-boone-pickens-on-the-passing-of-aubrey-mcclendon/">in a statement</a>. "No individual is without flaws, but his impact on American energy will be long-lasting."</p><p><strong>NEXT UP:&nbsp;<a href="http://www.businessinsider.com/fracking-fluids-are-seriously-toxic-2016-1" >We're finding out more and more about the worrisome link between fracking and health</a></strong></p>
<p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3" >The rise and fall of energy titan Aubrey McClendon</a></strong></p>
<p><a href="http://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/nutritionist-carbs-bad-lose-fat-2016-11">A nutritionist reveals the best time to eat carbohydrates — so that your body uses them up instead of storing them as fat</a></p> http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3The rise and fall of energy titan Aubrey McClendonhttp://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3
Sat, 05 Mar 2016 00:33:00 -0500Elena Holodny
<p>The rise and fall of energy titan Aubrey McClendon</p><p><a href="http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/insectothopter-cia-dragonfly-spy-drone-military-defense-espionage-spies-2016-12">In the 1970s the CIA created a spy drone the size of a dragonfly</a></p> http://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3Aubrey McClendon’s fracking legacy — the good, the bad, the uglyhttp://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3
Thu, 03 Mar 2016 13:34:00 -0500Tanya Lewis
<p><img style="float:right;" src="http://static5.businessinsider.com/image/56d744606e97c625048bb04b-729-547/former-chesapeake-ceo-mcclendon-charged-with-bid-rigging-of-land-leases-2016-3.jpg" alt="Aubrey McClendon walks through the French Quarter in New Orleans, Louisiana March 26, 2012. REUTERS/Sean Gardner " data-mce-source="Thomson Reuters" data-mce-caption="CEO, Chairman, and Co-founder of Chesapeake Energy Corporation McClendon walks through the French Quarter in New Orleans, Louisiana" /></p><p>Energy pioneer Aubrey McClendon <a href="http://www.businessinsider.com/former-chesapeake-ceo-aubrey-mcclendon-has-died-in-a-car-accident-2016-3">died in a car crash</a>&nbsp;just a day after he was indicted on conspiracy to rig bids for oil and natural gas leases.</p>
<p>The former Chesapeake Energy CEO rose to prominence by pioneering production techniques that unlocked America's supply of shale gas, which helped wean the country from its reliance on foreign oil.</p>
<p>His indictment came on the heels of a four-year federal antitrust investigation which found that&nbsp;his company had planned to rig the price of land leases in&nbsp;Oklahoma, <a href="http://www.reuters.com/article/us-chesapeake-enrgy-mcclendon-idUSKCN0W42ME">Reuters reports</a>.</p>
<p>While McClendon's own life was cut short, he left a legacy that will shape American energy policy&nbsp;&mdash; for better or for worse &mdash;&nbsp;for years to come.</p>
<p>His company, Chesapeake Energy, pioneered the use of oil and natural gas locked up in shale rock, a technique commonly known as hydraulic fracturing, or fracking. The technique allowed America to unlock decades' worth of energy, but has also been linked to serious environmental and health concerns.</p>
<h2>Fracking: The good, the bad, and the ugly</h2>
<p><img src="http://static1.businessinsider.com/image/56a29b9b58c32319008b48b0-2000-1333/505882540.jpg" alt="fracking crude oil" data-mce-source="Spencer Platt/Getty" data-mce-caption="ANDREWS, TX - JANUARY 20: An oil pumpjack works at dawn in the Permian Basin oil field on January 20, 2016 in the oil town of Andrews, Texas. Despite recent drops in the price of oil, many residents of Andrews, and similar towns across the Permian, are trying to take the long view and stay optimistic. The Dow Jones industrial average plunged 540 points on Wednesday after crude oil plummeted another 7% and crashed below $27 a barrel" />Fracking involves the injection of fracking fluid &mdash; consisting of pressurized water, sand or other ceramic materials, and thickening agents &mdash; into a hole drilled in the ground. This produces cracks in the shale rock that allow oil and natural gas to flow more easily.</p>
<p>The <a href="http://www.kgs.ku.edu/Publications/PIC/pic32.html">first fracking experiment</a>&nbsp;took place&nbsp;in 1947&nbsp;in the Hugoton gas field in Grant County, Kansas. One thousand gallons of napalm and sand from the Arkansas River were injected into a limestone rock&nbsp;formation that was clogged by mud from drilling operations. The attempt&nbsp;wasn't very successful, but&nbsp;the technology has advanced significantly since then.</p>
<p>Today, the <a href="http://www.kgs.ku.edu/PRS/Fracturing/Frac_Paper_SPE_152596.pdf">Society of Petroleum Engineers estimates</a>&nbsp;that 2.5 million&nbsp;fractures have been pumped worldwide over the last 60 years; more than a million of them have been&nbsp;in the US. The technique has unlocked large sources of energy that would otherwise be inaccessible. For example, the Marcellus Shale in western New York, Pennsylvania, and Ohio, is thought to contain enough natural gas to supply the United States <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3076392/">for more than 40 years</a>.</p>
<p>But fracking is incredibly&nbsp;controversial. Opponents say it can release harmful chemicals that <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1817691/">contaminate air and water supplies</a>, possibly <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC4143789/">trigger earthquakes</a>, and <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3076392/">cause human health problems</a>.</p>
<p><span>While scientists are just beginning to study the effects of fracking on the environment, some evidence suggests it can be done safely.&nbsp;</span><span>As <a href="http://www.scientificamerican.com/article/can-fracking-be-done-without-impacting-water/">Scientific American reported</a> in 2013, a <a href="http://science.sciencemag.org/content/340/6134/1235009.abstract">study</a> funded by the National Science Foundation and published in the journal Science found that fracking has "no irrefutable impact" on ground water quality.</span></p>
<p><span>The problem is, it's not always done safely. If the cement casing that surrounds a fracking well is made incorrectly, natural&nbsp;gas can leak along its sides or through cracks, releasing harmful gases like methane to the environment. Methane is one of the most potent greenhouse gases, which trap heat in the atmosphere and exacerbate&nbsp;climate change.</span></p>
<p><span>Another problem is the wastewater from these wells, which can contain&nbsp;toxic or even radioactive chemicals.&nbsp;The same NSF study found that fracking&nbsp;wastewater is already starting to contaminate rivers and other major waterways.</span></p>
<p>A number of countries and states <a href="http://keeptapwatersafe.org/global-bans-on-fracking/">have banned fracking</a>, but it continues to be a major source of American energy.</p>
<h2>McClendon's rise and fall</h2>
<p>Under McClendon, Chesapeake Energy grew from a small operation into the second-biggest natural gas producer in the United States, exceeded only by Exxon Mobil, according to <a href="http://www.nytimes.com/2016/03/03/business/energy-environment/aubrey-mcclendon-56-shale-gas-baron-dies-in-crash-a-day-after-indictment.html?emc=edit_th_20160303&amp;nl=todaysheadlines&amp;nlid=57415309">The New York Times</a>. With Wall Street backing, the company leased land all over the country for fracking, including Texas, Oklahoma, Ohio and Pennsylvania.</p>
<p><img style="float:right;" src="http://static2.businessinsider.com/image/4efb9371ecad04a665000007-400-300/chesapeake-1.jpg" alt="chesapeake silhouette" data-mce-source="Chesapeake Energy Corp" data-link="http://www.chk.com/Media/Photos/Pages/default.aspx" />As the Times reports, they produced so much energy that natural gas prices collapsed, and Chesapeake's shares tanked. McClendon also used his investments in the company to shore up as much as $1.1 billion in loans to pay off the cost of drilling the fracking wells, and he was later forced out of the company.</p>
<p>On Tuesday, the Justice Department indicted McClendon in a conspiracy in which two unnamed companies agreed not to bid against each other for oil and gas leases in northwest Oklahoma between late 2007 and early 2012, a charge he denied.</p>
<p>McClendon died in a car crash less than 24 hours later. Investigators have not yet determined the cause of death.</p>
<p>"He was a major player in leading the stunning energy renaissance in America," Texas energy investor T. Boone Pickens said <a href="http://www.boonepickens.com/2016/03/statement-from-t-boone-pickens-on-the-passing-of-aubrey-mcclendon/">in a statement</a>. "No individual is without flaws, but his impact on American energy will be long-lasting."</p><p><strong>NEXT UP:&nbsp;<a href="http://www.businessinsider.com/fracking-fluids-are-seriously-toxic-2016-1" >We're finding out more and more about the worrisome link between fracking and health</a></strong></p>
<p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3" >The rise and fall of energy titan Aubrey McClendon</a></strong></p>
<p><a href="http://www.businessinsider.com/how-aubrey-mcclendon-transformed-american-energy-2016-3#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/preauricular-sinus-small-hole-above-ear-2016-11">Here's why some people have a tiny hole above their ears</a></p> http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3The rise and fall of energy titan Aubrey McClendon (CHK)http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3
Wed, 02 Mar 2016 16:23:09 -0500Elena Holodny
<p><img style="float:right;" src="http://static4.businessinsider.com/image/56d748736e97c629008bb097-705-529/chesapeakes-ex-ceo-mcclendon-tries-to-force-new-drilling.jpg" alt="File photo of former Chief Executive Officer, Chairman, and Co-founder of Chesapeake Energy Corporation Aubrey McClendon in New Orleans, Louisiana March 26, 2012. REUTERS/Sean Gardner" data-mce-source="Thomson Reuters" data-mce-caption="Former CEO, Chairman, and Co-founder of Chesapeake Energy Corporation McClendon walks through the French Quarter in New Orleans, Louisiana" /></p><p></p>
<p>Former Chesapeake Energy CEO Aubrey McClendon has <a href="http://www.businessinsider.com/former-chesapeake-ceo-aubrey-mcclendon-has-died-in-a-car-accident-2016-3">died in a single-car accident</a>.</p>
<p><span>He was the cofounder of Chesapeake Energy and turned it into the country's second-largest natural-gas producer. McClendon was also a key player in the shale boom that has changed the global-oil markets over the last decade.</span></p>
<p><span>Business Insider took a closer look at the career McClendon built.</span></p>
<p><em>Editor's Note: Former Business Insider writer Rob Wile contributed to an earlier version of this feature.</em></p><h3>Aubrey Kerr McClendon was born on July 14, 1959, in Oklahoma City.</h3>
<img src="http://static3.businessinsider.com/image/56d749006e97c61e048bb0fc-400-300/aubrey-kerr-mcclendon-was-born-on-july-14-1959-in-oklahoma-city.jpg" alt="" />
<p><p><em>Source: <a href="http://www.youtube.com/watch?v=As33mjmhNbs">FoundationOKCPS</a></em></p></p>
<br/><br/><h3>He came from a prominent Oklahoma family. His great-uncle, Robert Kerr, was the state's 12th governor.</h3>
<img src="http://static1.businessinsider.com/image/56d7495a6e97c61a008bb0ed-400-300/he-came-from-a-prominent-oklahoma-family-his-great-uncle-robert-kerr-was-the-states-12th-governor.jpg" alt="" />
<p><p><em>Source: <a href="http://www.forbes.com/forbes/2011/1024/feature-aubrey-mcclendon-hero-energy-chesapeake-risk-christopher-helman.html">Forbes</a></em></p></p>
<br/><br/><h3>McClendon was voted class president and was the valedictorian of the Heritage Hall school in Oklahoma City.</h3>
<img src="http://static6.businessinsider.com/image/56d749916e97c61f048bb058-400-300/mcclendon-was-voted-class-president-and-was-the-valedictorian-of-the-heritage-hall-school-in-oklahoma-city.jpg" alt="" />
<p><p><em>Source: <a href="http://www.youtube.com/watch?v=As33mjmhNbs">FoundationOKCPS</a></em></p></p>
<br/><br/><a href="http://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3#/#mcclendon-then-attended-duke-university-where-he-majored-in-history-and-minored-in-accounting-there-is-now-a-dorm-there-named-after-his-family-4">See the rest of the story at Business Insider</a> http://www.businessinsider.com/former-chesapeake-ceo-aubrey-mcclendon-has-died-in-a-car-accident-2016-3Former Chesapeake CEO Aubrey McClendon has died in a car crash a day after being indicted for conspiracyhttp://www.businessinsider.com/former-chesapeake-ceo-aubrey-mcclendon-has-died-in-a-car-accident-2016-3
Wed, 02 Mar 2016 14:52:39 -0500Linette Lopez
<p><img style="float:right;" src="http://static5.businessinsider.com/image/56d744606e97c625048bb04b-729-547/former-chesapeake-ceo-mcclendon-charged-with-bid-rigging-of-land-leases-2016-3.jpg" alt="Aubrey McClendon walks through the French Quarter in New Orleans, Louisiana March 26, 2012. REUTERS/Sean Gardner " data-mce-source="Thomson Reuters" data-mce-caption="CEO, Chairman, and Co-founder of Chesapeake Energy Corporation McClendon walks through the French Quarter in New Orleans, Louisiana"></p><p>Former Chesapeake Energy CEO Aubrey McClendon has died in a single-car crash.</p>
<p>It took place around 9 a.m. in Oklahoma and, according to officials, the car was going very fast.</p>
<p>"Speed was definitely a factor in the fatality," Oklahoma City officials said in a press conference. "He pretty much drove straight into the wall."</p>
<p>On Tuesday, <a href="http://www.businessinsider.com/ap-chesapeake-energy-ex-ceo-mcclendon-indicted-2016-3">McClendon, 56, was indicted on conspiracy</a> to rig bids for oil and natural-gas leases. He and other companies allegedly colluded to figure out who would win the bids.</p>
<p>McClendon maintained his innocence in the following statement:</p>
<p style="padding-left: 30px;">The charge that has been filed against me today is wrong and unprecedented. I have been singled out as the only person in the oil and gas industry in over 110 years since the Sherman Act became law to have been accused of this crime in relation to joint bidding on leasehold. Anyone who knows me, my business record and the industry in which I have worked for 35 years, knows that I could not be guilty of violating any antitrust laws. All my life I have worked to create jobs in Oklahoma, grow its economy, and to provide abundant and affordable energy to all Americans. I am proud of my track record in this industry, and I will fight to prove my innocence and to clear my name.</p>
<p><div>
<blockquote class="twitter-tweet" lang="en">
<p>
Here's a picture of McClendon's vehicle. According to police, he ran into/off of a bridge: <a href="https://t.co/ce7RUSBQXi">pic.twitter.com/ce7RUSBQXi</a> </p>— Royce Young (@royceyoung) <a href="https://twitter.com/mims/statuses/705119998117806081">March 2, 2016</a>
</blockquote>
<script async src="//platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></p>
<p>McClendon, who founded Chesapeake in 1989, left it in 2013 with no shortage of controversy. It was the result of a 2012 Reuters investigation alleging conflict of interest at the country's second-largest natural-gas producer. The company did an internal investigation of its Founder Well Participation Program, which granted McClendon exclusive rights to company wells. The program was eventually suspended, but the business said that it found no misconduct.</p>
<p>At the time, energy magnate T. Boone Pickens sold all his Cheseapeake stock, but he also <a href="http://www.businessinsider.com/t-boone-pickens-chesapeake-energy-2012-5">told people not to count McClendon out.</a></p>
<p>McClendon went on to found and become CEO of American Energy Partners. Upon finding out that he passed away on Wednesday Pickens said that McClendon was a <a href="http://www.boonepickens.com/2016/03/statement-from-t-boone-pickens-on-the-passing-of-aubrey-mcclendon/">"true American entrepeneur."</a></p>
<p>“I’ve known Aubrey McClendon for nearly 25 years. He was a major player in leading the stunning energy renaissance in America. He was charismatic and a true American entrepreneur. No individual is without flaws, but his impact on American energy will be long-lasting," Pickens said in a statement on his website.</p>
<p>The company said in a statement:</p>
<p style="padding-left: 30px;">Aubrey's tremendous leadership, vision, and passion for the energy industry had an impact on the community, the country, and the world. We are tremendously proud of his legacy and will continue to work hard to live up to the unmatched standards he set for excellence and integrity.</p>
<p>That aside, McClendon lived incredibly well. He was the best paid CEO in America in 2008. His collection of vintage Texas and Oklahoma maps are worth $12 million, and he owned a portion of the Oklahoma City Thunder basketball team. There's a dorm at Duke, his alma mater, named after him.</p>
<p>A local Oklahoma news station has footage from the scene of the crash:</p>
<p><div>
<iframe width="640" height="360" src="//www.youtube.com/embed/q6gi7QqTmRI" frameborder="0" allowfullscreen></iframe>
</div></p><p><a href="http://www.businessinsider.com/former-chesapeake-ceo-aubrey-mcclendon-has-died-in-a-car-accident-2016-3#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/how-much-us-currency-dollar-bills-coins-money-cost-2016-11">A penny costs 1.43 cents to make — here’s what the rest of US currency costs</a></p> http://www.businessinsider.com/ap-chesapeake-energy-ex-ceo-mcclendon-indicted-2016-3Former Chesapeake Energy CEO Aubrey McClendon indicted over rigged lease bids in Oklahomahttp://www.businessinsider.com/ap-chesapeake-energy-ex-ceo-mcclendon-indicted-2016-3
Tue, 01 Mar 2016 20:28:00 -0500
<p><img style="float:right;" src="http://static4.businessinsider.com/image/56d640c42e526554008baaa3-729-547/sec-ends-probe-of-chesapeake-ex-ceo-mcclendon-no-action-planned.jpg" alt="Chief Executive Officer, Chairman, and Co-founder of Chesapeake Energy Corporation Aubrey McClendon walks through the French Quarter in New Orleans, Louisiana March 26, 2012. REUTERS/Sean Gardner" data-mce-source="Thomson Reuters" data-mce-caption="CEO, Chairman, and Co-founder of Chesapeake Energy Corporation McClendon walks through the French Quarter in New Orleans, Louisiana" /></p><p>Aubrey McClendon, the former chief executive of Chesapeake Energy Corp., has been indicted for conspiring to rig bids to buy oil and natural gas leases in northwest Oklahoma.</p>
<p>The Department of Justice said Tuesday the indictment alleges that the conspiracy ran from December 2007 to March 2012.</p>
<p>The department said that McClendon allegedly orchestrated the scheme between two large energy companies. They would decide ahead of time who would win bids, with the winner then allocating an interest in the leases to the other company.</p>
<p>Leasehold interests usually include the right to develop the land and to extract oil and natural gas for a period of time, typically three to five years.</p>
<p>The indictment was filed in U.S. District Court for the Western District of Oklahoma.</p><p><a href="http://www.businessinsider.com/ap-chesapeake-energy-ex-ceo-mcclendon-indicted-2016-3#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/r-sec-ends-probe-of-chesapeake-ex-ceo-mcclendon-no-action-planned-2014-07The SEC Has Ended Its Probe Of Former Chesapeake Energy CEO McClendonhttp://www.businessinsider.com/r-sec-ends-probe-of-chesapeake-ex-ceo-mcclendon-no-action-planned-2014-07
Thu, 08 May 2014 04:56:00 -0400Anannya Pramanick
<p><img style="float:right;" src="http://static4.businessinsider.com/image/536b4645eab8ea380833ed19-665-499/chief-executive-officer-chairman-and-co-founder-of-chesapeake-energy-corporation-aubrey-mcclendon-walks-through-the-french-quarter-in-new-orleans-louisiana-march-26-2012-reuterssean-gardner.jpg" border="0" alt="Chief Executive Officer, Chairman, and Co-founder of Chesapeake Energy Corporation Aubrey McClendon walks through the French Quarter in New Orleans, Louisiana March 26, 2012. REUTERS/Sean Gardner" /></p><p>(Reuters) - Chesapeake Energy Corp said on Wednesday the U.S. Securities and Exchange Commission has ended its probe against the company and its former chief executive Aubrey McClendon.</p>
<p>The company said in a regulatory filing that the SEC's Fort Worth regional office advised the company last month that it had concluded its investigation and did not intend to recommend enforcement action. (http://r.reuters.com/guk29v)</p>
<p>The SEC began its investigation in May 2012.</p>
<p>McClendon, who co-founded Chesapeake in 1989, left the company in April last year after clashing over spending with the company's board and a series of Reuters investigations led to civil and criminal probes on the company.</p>
<p>The company's shares touched their highest since October 2011 after it posted better-than-expected quarterly profit and hiked its production forecast earlier on Wednesday.</p>
<p>Since leaving Chesapeake, McClendon has raised nearly $4 billion in cash and financing to invest in North American shale formations.</p>
<p>He has also filed to raise up to $2 billion to buy and drill oil and gas properties within the United States through a partnership called American Energy Capital Partners LP.</p>
<p>(Reporting by Anannya Pramanick in Bangalore; Editing by Eric Walsh)</p><p><a href="http://www.businessinsider.com/r-sec-ends-probe-of-chesapeake-ex-ceo-mcclendon-no-action-planned-2014-07#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/mcclendon-sells-vacation-home-for-10-m-2013-6Former Chesapeake Energy CEO Aubrey McClendon Is Selling His Waterfront Vacation Home For $10 Millionhttp://www.businessinsider.com/mcclendon-sells-vacation-home-for-10-m-2013-6
Thu, 06 Jun 2013 11:50:00 -0400Linette Lopez
<p><img style="float:right;" src="http://static6.businessinsider.com/image/51b0ae5369bedd6f46000000-400-300/aubrey-mcclendon-michigan-house.png" border="0" alt="Aubrey McClendon Michigan House" width="400" height="300" /></p><p>The founder and former CEO of Chesapeake Energy, Aubrey McClendon, is selling is gorgeous vacation home on Lake Michigan for $10 million, <a href="http://online.wsj.com/article/SB10001424127887324412604578513534277131360.html#%2F1">says the WSJ.</a></p>
<p>McClendon stepped down from his post last year amid intense government scrutiny and the crash of his company's stock, but he still has a lot of cool stuff &mdash; this house is just a small part of that.</p>
<p>In fact, he's selling because he and his wife have another vacation house nearby, so don't feel sorry for the guy.</p>
<p>The house is built on the Singapore Dunes, a proposed mixed-use development that McClendon owns in its entirety. Two other parcels of land on the property are being sold for $3 million and $1.5 million.</p>
<p>But the house is the real star. It has breathtaking views of the water and you can check out through wall to wall windows. There are six bedrooms, five bedrooms and a guest house.</p>
<p><a href="http://www.richardwaskin.remax-michigan.com/remaxmi/index.asp?p=findahome.asp&amp;mode=N">Dick Waskin of Re/Max</a> Saugatuck-Douglas and <a href="http://www.waterfront-luxuryhomes.com/">Andrea Crossman of Coldwell Banker </a>Woodland Schmidt have the listing.</p><img src="http://static1.businessinsider.com/image/51b0ab7469bedd3340000002-400-300/.jpg" alt="" />
<br/><br/><img src="http://static2.businessinsider.com/image/51b0ab76eab8ea2804000001-400-300/.jpg" alt="" />
<br/><br/><img src="http://static4.businessinsider.com/image/51b0ab7a6bb3f7dd09000000-400-300/.jpg" alt="" />
<br/><br/><a href="http://www.businessinsider.com/mcclendon-sells-vacation-home-for-10-m-2013-6#-4">See the rest of the story at Business Insider</a> http://www.businessinsider.com/chesapeake-subpoenaed-by-the-sec-2013-3Now Chesapeake Has Been Subpoenaed By The SEC http://www.businessinsider.com/chesapeake-subpoenaed-by-the-sec-2013-3
Fri, 01 Mar 2013 09:40:49 -0500Rob Wile
<p><img style="float:right;" src="http://static2.businessinsider.com/image/4f9eca57ecad04314700001a-400-300/kateuptonaubreymcclendon.jpg" border="0" alt="kate upton aubrey mcclendon" /></p><p>The <a class="hidden_link" href="http://www.businessinsider.com/blackboard/sec">SEC</a> has upgraded its inquiry of Chesapeake Energy's alleged failure to reveal conflict of interest to a full-blow investigation and has subpoenaed the company for information, <a href="http://services.corporate-ir.net/SEC.Enhanced/SecCapsule.aspx?c=104617&amp;fid=8665438">according to a 10-K filed today</a>.</p>
<p>Outgoing chief Aubrey McClendon is also providing information, the filing said.</p>
<p>Here's the exact language from the filing:</p>
<p style="padding-left: 30px;"><span>On December 21, 2012, the SEC's Fort Worth Regional Office advised Chesapeake that its inquiry is continuing as an investigation and it has issued subpoenas for information and testimony. The Company, including Mr.&nbsp;McClendon, is providing information to the SEC in connection with this matter</span><span>.</span><span>&nbsp;The Company is also responding to related inquiries from other governmental and regulatory agencies and self-regulatory organizations.</span></p>
<p>Last summer, the Pittsburgh Post-Gazette and <a class="hidden_link" href="http://www.businessinsider.com/blackboard/reuters">Reuters</a> uncovered an unusual arrangement at the country's second-largest natural gas producer that allowed McClendon to secure <span>&nbsp;$1.1 billion in&nbsp;</span>personal loans using drilling property as collateral.</p>
<p>The SEC launched an informal inquiry into the allegations soon after the reports came out.&nbsp;</p>
<p>McClendon is set to step down in April.</p><p><a href="http://www.businessinsider.com/chesapeake-subpoenaed-by-the-sec-2013-3#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/theres-no-way-to-untangle-chesapeke-and-its-departing-ceo-2013-1There's No Way To Untangle Chesapeake And Its Departing CEOhttp://www.businessinsider.com/theres-no-way-to-untangle-chesapeke-and-its-departing-ceo-2013-1
Thu, 31 Jan 2013 06:48:00 -0500Brian Grow, Anna Driver, and Joshua Schneyer
<p><img style="float:right;" src="http://static1.businessinsider.com/image/51092df96bb3f7be46000006-400-308/mc5.png" border="0" alt="aubrey mcclendon chesapeake" /></p><p>Aubrey McClendon will no longer be running Chesapeake Energy Corpcome April 1. But he is likely to remain deeply entangled with the company he founded 24 years ago.</p>
<p>America's second-largest natural-gas producer said on Tuesday that McClendon is stepping down as chief executive and a board member. He is leaving behind legal predicaments and intertwined personal and corporate interests that analysts say could linger for years.</p>
<p>Among the trickiest to unwind is his signature perk. McClendon controls interests of up to 2.5 percent in thousands of Chesapeake wells, according to an analysis of Chesapeake filings with the Securities and Exchange Commission. The company owns interests in 45,700 producing oil and gas wells, according to its most recent annual report.</p>
<p>McClendon's stakes are part of a controversial benefit, known as the Founder Well Participation Plan, which awarded him a stake in every well Chesapeake drilled since 1993, provided that he pay an equivalent share of the costs. He has participated in the plan every year since, with the exception of five quarters in 1999 and 2000, the SEC filings show.</p>
<p>McClendon began losing his grip on the company after Reuters reported last year that he had borrowed more than $1 billion against his well stakes from a firm that also invested in Chesapeake itself. That and other Reuters reports of potential conflicts of interest, coupled with a cash crunch amid weak gas prices and bloated spending, sparked an investor revolt and a board shakeup. Analysts said that while the unusual arrangements were part of his undoing, they will not be easy to unwind.</p>
<p>"I see his continued involvement as a negative. These things that he created, you can argue that they hurt the stock price," said Phil Weiss, oil and gas analyst at Argus Research in New York. "And they are not going away just because he is. That part of his legacy remains."</p>
<h3>LAST SUPPER</h3>
<p>Chesapeake referred questions about the well plan to a personal spokesman for McClendon, who declined to comment.</p>
<p>The company said it has retained headhunter firm Heidrick &amp; Struggles to find his replacement. News of McClendon's departure has sent the company's stock up more than 6 percent.</p>
<p>Three people familiar with the situation said board members decided to seek a successor in the past several weeks and called in Heidrick to help. New board directors tapped last year by Chesapeake's two biggest shareholders, O. Mason Hawkins' Southeastern Asset Management and Carl Icahn, had been pushing for a change in leadership in tandem with new board chairman Archie Dunham, these people said. The new directors grew convinced the company's shares would not rebound as long as McClendon remained at the helm, they said.</p>
<p>McClendon sent an email to top Chesapeake managers after the board's announcement in which he suggested he was not aware of the board's thinking during a dinner he held with his vice presidents just a week ago.</p>
<p>"This move was not in contemplation by me at that time," he wrote in the email, whose contents were read to Reuters.</p>
<p>Icahn, reached by telephone Wednesday, declined to comment on McClendon's exit beyond what he said in a news release on Tuesday night in which he praised the founder's vision for the natural gas business. Hawkins could not be reached for comment. Dunham declined to comment.</p>
<p>The announcement followed a frenzied year in which a severe financial crunch and a governance crisis hammered Chesapeake. The Reuters stories triggered official probes and sparked shareholder lawsuits. The SEC, the U.S. Justice Department and the board are investigating whether McClendon blurred the line between his personal and corporate dealings, and into possible antitrust violations. The board said its review was not the trigger for McClendon's departure.</p>
<p>In June, Reuters reported that Chesapeake discussed with Encana Corp, one of its top competitors, a plan to suppress land prices in Michigan. That matter is under investigation by the state of Michigan and the Department of Justice. Two weeks ago, Encana CEO Randy Eresman said he was stepping down. Earlier, Reuters reported that McClendon had arranged to personally borrow more than $1.3 billion from EIG Global Energy Partners, an investment-management firm that also is a big investor in Chesapeake. EIG has said the transactions were proper.</p>
<h3>"IMPORTANT PARTNER"</h3>
<p>Chesapeake's announcement signaled the company expects his presence will be felt for quite a while.</p>
<p>McClendon "will continue to be an important partner with the company given his stock ownership, as well as his interests in certain of the company's wells," it said in a statement.</p>
<p>He will also receive his "full compensation and other benefits" under his employment agreement.</p>
<p>A person familiar with the terms of the separation said it was being treated as "termination without cause," entitling the CEO to some of the most generous benefits laid out in his employment contract.</p>
<p>McClendon is entitled to total compensation of about $47 million. That includes $11.7 million in total cash compensation, based on McClendon's salary and bonus, to be paid out over four years.</p>
<p>It also includes restricted stock awards already given to McClendon that have a value of $33.5 million, the person familiar with the compensation package said.</p>
<p>He will also be entitled to CEO-style perks, including personal use of corporate jets that could be worth up to $1 million over four years, the person said.</p>
<p>Internal 2010 flight logs show the CEO took 155 business charters at a cost of $2.25 million and 75 personal flights worth an estimated $850,000, Reuters reported last year. These included family vacations to Europe and the Bahamas.</p>
<p>The contract also calls for McClendon to continue using Chesapeake accounting services. Reuters last year disclosed that a Chesapeake unit handling such services for McClendon had six company employees, occupying a building on the edge of the campus. Known as "AKM Operations," after his initials, it served as the hub for managing McClendon's personal interests in Chesapeake wells, from assessing their value to filing court paperwork documenting his ownership.</p>
<h3>"NOT FOR SALE"</h3>
<p>The board recently cut McClendon's pay package and gave him no bonus for 2012. McClendon owns 2.9 million Chesapeake shares, or less than 1 percent of the company, according to a January 7 filing with the SEC.</p>
<p>His enduring well interests could crimp Chesapeake's room for maneuver. Chairman Dunham told employees in an email on Tuesday that the company "is not for sale." Wall Street analysts have said Chesapeake is a top candidate for an acquisition, however, given its impressive assets. It is the largest driller of new wells in the United States and controls oil-and-gas drilling rights on more than 15 million acres stretching from New York to Texas.</p>
<p>The well stakes could make it harder to structure a deal, some analysts said.</p>
<p>"I don't know that somebody wants to step into those shoes," said Argus analyst Weiss. "I can see companies being interested in certain assets, but it's hard for me to imagine anyone wanting to take it all on."</p>
<p>Since 2009, McClendon has pledged his Chesapeake well interests as collateral for more than $1.3 billion in financing from EIG, according to a Reuters review of loan agreements filed in five states. The loan proceeds have been used to pay McClendon's costs associated with his stakes in the wells.</p>
<p>The loan agreements provide EIG a claim on McClendon's interests in the Chesapeake wells should he default. Last March, McClendon arranged a new $450 million loan from EIG through a company called Pelican Energy to finance well interests that Chesapeake is obligated to transfer to him through June 30, 2014 - 15 months after he steps down as CEO.</p>
<p>EIG will retain rights to the well stakes even after McClendon departs.</p>
<p>"It was not dependent upon him being an employee of the company," said a person familiar with the matter.</p>
<h3>"THE CROSSHAIRS"</h3>
<p>Chesapeake also must deal with the investigations and lawsuits McClendon that is leaving behind.</p>
<p>Over the last nine months, the SEC, U.S. Justice Department and Michigan Attorney General have demanded thousands of documents from Chesapeake. EIG, which is not under investigation in the SEC probe, has given the agency emails related to Chesapeake and McClendon, said a person familiar with the matter.</p>
<p>Civil litigation also continues. More than a dozen Chesapeake shareholders have sued the company over alleged breaches of fiduciary duty related to McClendon's loans. Those lawsuits, some of which have been consolidated into class actions, are playing out in Oklahoma courts.</p>
<p>Separately, more than 100 landowners have filed suit in Michigan since 2010, alleging that Chesapeake breached contracts when it canceled leases in the state. Some of the cases, reviewed by Reuters, allege McClendon was the architect of a plan to cancel the agreements and thus deprived landowners of lease bonus payments.</p>
<p>Michigan attorney Susan Topp has filed more than 120 suits since 2010 against Chesapeake or its Michigan land brokers for allegedly backing out on land deals there. Most of the cases have been settled. But Topp said she is in the process of filing around 50 new ones.</p>
<p>"As far as I'm concerned, his departure won't change things. He may be out of the boardroom, but not out of the crosshairs," said Topp.</p>
<p>A Chesapeake spokesman declined to comment on the pending investigations. The findings of the board's probe into McClendon's personal transactions will be released next month, but Chesapeake said in a statement on Tuesday that the review has "to date found no improper conduct."</p>
<h3>THUNDER CLOUD</h3>
<p>The mingling of McClendon's personal and corporate worlds extends to the basketball court.</p>
<p>Through a firm called the Professional Basketball Club, McClendon owns a 19.2 percent interest in the NBA's Oklahoma City Thunder basketball team. According to SEC filings, Chesapeake has committed to pay at least $60 million over the next decade for naming rights at the Thunder's home stadium, the Chesapeake Energy Arena, and to sponsor the team.</p>
<p>A 10-year naming rights deal, signed in 2011, will cost Chesapeake between $3 million and $4 million annually. The company also agreed to pay an average of $3 million a year in Thunder sponsorship fees until 2023. The Thunder, valued by Forbes at $475 million, lost in the NBA finals last year to the Miami Heat.</p>
<p>According to a person familiar with the situation, there is no change in the company's relationship with the Thunder.</p>
<p>McClendon appeared to hint on Wednesday that his exit was unlikely to mark the end of his career. In his daily inspirational quote-of-the-day message to employees, he cited Albert Einstein: "In the middle of every difficulty comes opportunity."</p>
<p>(Additional reporting by Jennifer Ablan, Matthew Goldstein, Carrick Mollenkamp, Jeanine Prezioso, David Sheppard and John Shiffman.; Edited by Michael Williams and Andre Grenon)</p>
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<p><img class="nc_pixel" src="http://pixel.newscred.com/px.gif?key=YXJ0aWNsZT0xODJjYTQwZDA1ZmE5ZjExYzFlOWNlMTZhMmNiZmViZiZvd25lcj1lMjI0N2Q1MGI3OThiNGFmYmY4ZWMwMzI0YmY4MDI1YSZub25jZT0yN2UwZmVjYS0yNTI4LTRkYmQtYTVkOC1hNDkxYWUyMWZkYzgmcHVibGlzaGVyPThjMDBmYmVlNjFkNWJjZjBjNjA5MmQ4YjkyZWJiY2Ex" border="0" alt="" width="1" height="1" /></p><p><a href="http://www.businessinsider.com/theres-no-way-to-untangle-chesapeke-and-its-departing-ceo-2013-1#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/chesapeake-energy-liquids-acreage-2012-7CHART: Chesapeake Energy Owns An Incredible Amount Of Land (CHK)http://www.businessinsider.com/chesapeake-energy-liquids-acreage-2012-7
Mon, 02 Jul 2012 00:48:00 -0400Rob Wile
<p>Aubrey McClendon, CEO of Chesapeake Energy, famously built his reputation in the energy industry&nbsp;<a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=5&amp;ved=0CGYQFjAE&amp;url=http%3A%2F%2Fwww.forbes.com%2Fforbes%2F2011%2F1024%2Ffeature-aubrey-mcclendon-hero-energy-chesapeake-risk-christopher-helman.html&amp;ei=hFTwT_qKKce56wHdx-mOBg&amp;usg=AFQjCNHT_EPjHWgqysRtjlYHsldKOW1L8Q&amp;sig2=sulJ2-QTRAIqU4CkWQldFQ">as a "landman"</a>: buying thousands of acres of property with potentially lucrative hydrocarbons underneath.&nbsp;</p>
<p>These days, with oil and gas prices sitting at lows, McClendon has promised to turn the company into a&nbsp;<a href="http://seekingalpha.com/article/552841-chesapeake-energy-s-ceo-discusses-q1-2012-results-earnings-call-transcript">"manufacturing" company</a>&nbsp;&mdash; meaning focusing more on straight drilling, as opposed to flipping real estate.&nbsp;</p>
<p>But it's not going to be easy to&nbsp;<a href="http://seekingalpha.com/article/587801-chesapeake-energy-s-ceo-announces-increase-of-term-loan-to-4-0-billion-transcript">"dismantle the Chesapeake land machine"</a>&nbsp;as McClendon put it in a recent earnings call &mdash; here's how much land they own (via <a class="hidden_link" href="http://www.businessinsider.com/blackboard/credit-suisse">Credit Suisse</a>):</p>
<p><img src="http://static1.businessinsider.com/image/4feddc8cecad049807000009-647-384/acreage.png" border="0" alt="acreage" width="647" height="384" /></p>
<p><strong></strong>It will take years for Chesapeake to scrape the land-froth off its balance sheet and shrink itself into a normal-looking energy player.</p>
<p><strong><strong>SEE MORE &mdash;&nbsp;</strong><a href="http://www.businessinsider.com/events-that-will-trigger-natural-gas-prices-2012-5"><span class="s2"><strong>The 9 Events That Trigger Natgas Price Shocks &gt;</strong></span></a></strong></p><p><a href="http://www.businessinsider.com/chesapeake-energy-liquids-acreage-2012-7#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/heres-our-favorite-perk-from-forbes-most-outrageous-executive-perks-list-2012-6Here's Our Favorite Perk From Forbes' 'Most Outrageous Executive Perks' Listhttp://www.businessinsider.com/heres-our-favorite-perk-from-forbes-most-outrageous-executive-perks-list-2012-6
Wed, 27 Jun 2012 16:30:00 -0400Rob Wile
<p><img style="float:right;" src="http://static3.businessinsider.com/image/4f7c510a6bb3f7f84e0000b7/private-jet.jpg" border="0" alt="private jet" /></p><p>It really wasn't close.</p>
<p><a href="http://www.forbes.com/sites/danielfisher/2012/06/27/the-most-outrageous-executive-perks/">Among this year's list of "most outrageous executive perks" compiled by Forbes</a> are some decent contenders &mdash; hundreds of thousands on cars, second homes and personal security.</p>
<p><strong>But SandRidge Energy's Tom Ward spent&nbsp;</strong><span><strong>$783,533 on "accounting support" from the company's own employees</strong> (though <span>he does reimburse half of each such accounting support employee&rsquo;s&nbsp;</span><span>annual salary and cash bonus) was the runaway favorite.</span>&nbsp;</span></p>
<p><span>The CEO of Chesapeake (of which Ward used to be president) Aubrey McClendon is second in that category, with $250,000 in accounting fees.</span></p>
<p><span>This almost certainly points to the issues raised in recent reports about the unusual investment opportunities the two have received as Chesapeake executives.&nbsp;</span></p>
<p>That would be the Founder Well Participation Program, which, until it was phased out this year, <a href="http://articles.businessinsider.com/2012-04-23/markets/31385539_1_chesapeake-transactions-bhp-billiton">allowed the pair to own personal stakes in wells drilled by the company.</a></p>
<p><span></span>Not surprisingly,<a href="http://articles.businessinsider.com/2012-04-23/markets/31385539_1_chesapeake-transactions-bhp-billiton"> after Reuters pointed out the potential conflicts in such a program</a>, the full nature of which was not disclosed to shareholders,&nbsp;outrage ensued...</p><p><a href="http://www.businessinsider.com/heres-our-favorite-perk-from-forbes-most-outrageous-executive-perks-list-2012-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/there-were-three-kings-in-the-stadium-in-oklahoma-city-2012-6The King Of Basketball, The King Of Fracking, And The King Of Chinese Oil Walked Into A Stadiumhttp://www.businessinsider.com/there-were-three-kings-in-the-stadium-in-oklahoma-city-2012-6
Mon, 25 Jun 2012 09:20:00 -0400Gus Lubin
<p><img style="float:right;" src="http://static3.businessinsider.com/image/4fd892ce69beddaa61000002-400-299/lebron-james-backing-down-russell-westbrook-in-nba-finals.jpg" border="0" alt="lebron james backing down russell westbrook in nba finals" width="400" height="299" /></p><p>There were three "kings" in the Chesapeake Energy Arena on June 14, according to a Jefferies note:</p>
<p style="padding-left: 30px;"><strong>Fu Chengyu, Aubrey McClendon and <a href="http://www.businessinsider.com/blackboard/lebron-james" class="hidden_link">LeBron James</a>.</strong> Sinopec chairman Fu Chengyu, Chesapeake CEO Aubrey McClendon and <a href="http://www.businessinsider.com/blackboard/miami-heat" class="hidden_link">Miami Heat</a> forward LeBron James are in leagues of their own. It is no wonder fate brought about a convergence for one night in June. We believe Fu Chengyu will champion the "internationalization" of Sinopec, like Aubrey has championed shale fracking and LeBron James has championed... himself becoming champion.</p>
<p>Here's a picture of <a href="http://espn.go.com/nba/photos?gameId=320614025&amp;photoId=2143924#photo_2143924">Fu sitting courtside</a>.</p>
<p>Sinopec is <a href="http://www.forbes.com/sites/christopherhelman/2012/06/21/what-to-expect-from-a-sinopec-chesapeake-deal/">expected</a> to pick up some of Chesapeake's assets, continuing its three-year international shopping spree. Jefferies rated the stock a "buy."</p>
<h3><a href="http://www.businessinsider.com/these-8-regions-have-all-the-worlds-oil-2012-5">Now check out the 8 regions with the most oil and gas &gt;</a></h3><p><a href="http://www.businessinsider.com/there-were-three-kings-in-the-stadium-in-oklahoma-city-2012-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/aubrey-mcclendon-lake-michigan-resort-2012-6Take An Illustrated Tour Of Aubrey McClendon's Lake Michigan Mega Resorthttp://www.businessinsider.com/aubrey-mcclendon-lake-michigan-resort-2012-6
Wed, 13 Jun 2012 13:53:00 -0400Rob Wile
<p><img style="float:right;" src="http://static4.businessinsider.com/image/4fd8ab876bb3f72c0b000001/singapore-4.jpg" border="0" alt="singapore 4" /></p><p>What do you get for the man who has it all?</p>
<p>How about a resort and marina, 900 miles away from your hometown?</p>
<p>Earlier this month, <a href="http://www.businessinsider.com/blackboard/reuters" class="hidden_link">Reuters</a> dug into the <a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=4&amp;ved=0CGIQFjAD&amp;url=http%3A%2F%2Fwww.reuters.com%2Farticle%2F2012%2F06%2F07%2Fus-chesapeake-mcclendon-profile-idUSBRE8560IB20120607&amp;ei=oabYT_j_L4q49QTbnOm_Aw&amp;usg=AFQjCNGK808WnOsZqFgWyH4cchZ8mY2Dog&amp;sig2=Atqyf6gHKBA5bxUWV_yomQ">"lavish" lifestyle</a> Chesapeake Energy CEO and Oklahoma City resident Aubrey McClendon leads &mdash; <a href="http://www.businessinsider.com/the-life-of-aubrey-mcclendon-2012-4">elements of which we've previously highlighted.</a>&nbsp;</p>
<p>One of these was a plan to build a massive resort on the shores of Lake Michigan that has divided a local town.</p>
<p>Yesterday, McClendon cleared a major hurdle to seeing the plan through, as <a href="http://www.newschannel10.com/story/18758413/deal-okd-between-mich-community-energy-exec">a judge okayed a settlement</a> between Saugatuck Township, Mich. and the LLC McClendon has set up to develop the property.</p>
<p>McClendon purchased the property some seven years ago for $38 million. Local news reports have described it as "pristine piece of dune land," while the firm representing McClendon has argued it's derelict.</p>
<p>In any event, here are the specs for the project, which would be called "Singapore Dunes":</p>
<ul>
<li>Three towers with condos</li>
<li>24 houses</li>
<li>66-slip marina</li>
<li>An equestrian center</li>
<li>An inn with 25 rooms</li>
<li>9-hole golf course</li>
</ul>
<p>Here's what the project looks like. (And to be clear, this is a planned development, not a future McClendon residence.)</p>
<p><img src="http://static3.businessinsider.com/image/4fd8a593ecad04325d000006/singapore-dunes-2.jpg" border="0" alt="singapore dunes 2" width="620" />&nbsp;</p>
<p>&nbsp;</p>
<p><img src="http://static3.businessinsider.com/image/4fd8a5676bb3f76704000003/singapore-dunes-1.jpg" border="0" alt="singapore dunes 1" width="620" /></p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p><img src="http://static6.businessinsider.com/image/4fd8a8e569bedd972b000007/singapore-dunes-3.jpg" border="0" alt="singapore dunes 3" /></p>
<p>Here's the project's logo</p>
<p><img src="http://static1.businessinsider.com/image/4fd8a91e69bedd1f26000008/singapore-dunes-4.jpg" border="0" alt="singapore dunes 4" width="400" />&nbsp;</p>
<p>And here's how part of the property currently looks:</p>
<p><img src="http://static2.businessinsider.com/image/4fd8a95feab8eadb46000016/singapore-dunes-5.jpg" border="0" alt="singapore dunes 5" width="620" /></p>
<p>And here's another angle:</p>
<p><img src="http://static3.businessinsider.com/image/4fd8aa2f69bedd2c2f000000/dunes.png" border="0" alt="dunes" /></p><p><a href="http://www.businessinsider.com/aubrey-mcclendon-lake-michigan-resort-2012-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/forbes-aubrey-mcclendon-is-the-quintessential-baby-boomer-of-his-generation-2012-6Forbes: Aubrey McClendon 'Is The Quintessential Baby Boomer Of His Generation' http://www.businessinsider.com/forbes-aubrey-mcclendon-is-the-quintessential-baby-boomer-of-his-generation-2012-6
Mon, 11 Jun 2012 12:59:51 -0400Rob Wile
<p><img style="float:right;" src="http://static1.businessinsider.com/image/4f9eca57ecad04314700001a/kate-upton-aubrey-mcclendon.jpg" border="0" alt="kate upton aubrey mcclendon" /></p><p>Aubrey McClendon.</p>
<p>What else can we say at this point that this picture hasn't already said? The guy's had to operate in 24-hour crisis mode for nearly four months, yet appears to have barely broken a sweat, having made time to <a href="https://twitter.com/allstarcharts/statuses/184085032242126849">attend Oklahoma City Thunder playoff games</a>&nbsp;and&nbsp;<a href="http://www.businessinsider.com/chesapeake-energy-3-billion-loan-2012-5">securing billion-dollar financing from Goldman Sachs</a>.&nbsp;&nbsp;</p>
<p>But briefly, just in case you haven't been paying attention, the Chesapeake Energy CEO has since March been the subject of an avalanche of reports alleging, among other things:</p>
<ul>
<li>He'd <a href="http://www.post-gazette.com/stories/business/news/chesapeake-energy-ceo-capitalizing-today-on-tomorrows-profits-in-west-virginias-farmland-628134/">failed to fully disclose his financial interests in company-owned wells to shareholders or landowners</a>, leaving them both exposed to potential losses&nbsp;</li>
<li>He <a href="http://www.reuters.com/article/2012/05/02/us-chesapeake-mcclendon-hedge-idUSBRE8410GG20120502">reportedly ran a $200 million hedge fund</a> while conducting day-to-day Chesapeake operations</li>
<li>Chesapeake employees spent <a href="http://www.reuters.com/article/2012/06/07/us-chesapeake-mcclendon-profile-idUSBRE8560IB20120607">15,000 hours on McClendon's personal projects in 2010</a></li>
</ul>
<p>The <a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=4&amp;ved=0CGUQFjAD&amp;url=http%3A%2F%2Fwww.businessinsider.com%2Firs-now-wants-a-piece-of-chesapeake-ceo-aubrey-mcclendons-well-plan-2012-5&amp;ei=PRPWT7fhE4mX0QH90Pz9Ag&amp;usg=AFQjCNEA5qy7iUmOVvC55ciyv8giHBwYZw&amp;sig2=tkE6DrsXggr8055_UP3fbw">IRS</a> and <a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=4&amp;ved=0CGUQFjAD&amp;url=http%3A%2F%2Fwww.forbes.com%2Fsites%2Fchristopherhelman%2F2012%2F04%2F26%2Famid-sec-inquiry-chesapeake-board-says-it-will-end-aubrey-mcclendons-sweetheart-deal%2F&amp;ei=FhPWT-HbKITu0gGuzdGeAw&amp;usg=AFQjCNFlaszxY-sICjfk6UouMdPlbuvaxw&amp;sig2=adtAeqqEedH8ngVHy5HP6A">SEC</a> have already stepped in, although neither agency has yet accused the company of wrongdoing. McClendon was also <a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=1&amp;ved=0CFYQFjAA&amp;url=http%3A%2F%2Fwww.bloomberg.com%2Fnews%2F2012-05-01%2Fchesapeake-energy-to-strip-mcclendon-of-chairman-role.html&amp;ei=PRXWT6nBOaXD0QGc-NGWAw&amp;usg=AFQjCNHT3ygeaNRX7hGXW8B7WslRauReTg&amp;sig2=zW7UgrCuc3YJ9RfJzWXA8w">stripped of his chairmanship in May.</a></p>
<p>Forbes' Chris Helman has been writing about Chesapeake for a good while, and this weekend <a href="http://www.forbes.com/sites/christopherhelman/2012/06/09/give-aubrey-mcclendon-one-more-chance/">pronounced his final verdict on McClendon's travails</a>:&nbsp;<strong>He is the quintessential baby boomer, and that's why he should stay on as CEO.&nbsp;</strong></p>
<p>From Helman:</p>
<p style="padding-left: 30px;">"...contrast [the aforementioned problems] with what this megalomaniacal micromanaging risktaker has built. A giant company with unparalleled assets that undergird the shale gas miracle that came out of nowhere to provide the U.S. with 100 years or more of clean-burning natural gas. McClendon has led the charge of this supply revolution. No one has grabbed more land or drilled more wells. No one has paid more money to poor farmers in the middle of nowhere who 10 years ago would have ever dreamed there was oil and gas under their fields.</p>
<p style="padding-left: 30px;">"McClendon is not just the quintessential wildcatter of his generation, he&rsquo;s the quintessential baby boomer &mdash;<strong> always wanting more, more, more and willing to borrow, borrow, borrow to get it."&nbsp;</strong></p>
<p><strong></strong>Helman is convinced that with the <a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=3&amp;ved=0CF8QFjAC&amp;url=http%3A%2F%2Fwww.businessinsider.com%2Ffour-chesapeake-energy-board-members-are-resigning-2012-6&amp;ei=8xXWT9vQFKTj0QGikpWFAw&amp;usg=AFQjCNEU1_tGRbqhBR5mHZhnds_vIMZoXA&amp;sig2=OOfJKro7AlCpTSvYM2w88w">new independent board coming in</a>, McClendon's worst tendencies can be reined in.</p>
<p style="padding-left: 30px;"><span>"Give McClendon the opportunity to redeem himself. He loves the company like his own child. He knows the assets, he knows the people, he knows the systems. Let him sort out the problems and deleverage the company. Give him until next year&rsquo;s annual meeting. If he drags his feet, boot him."</span></p>
<p><strong>See More: <a href="http://www.businessinsider.com/the-life-of-aubrey-mcclendon-2012-4">The Fabulous Life Of Aubrey McClendon</a></strong></p><p><a href="http://www.businessinsider.com/forbes-aubrey-mcclendon-is-the-quintessential-baby-boomer-of-his-generation-2012-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/bloomberg-chesapeake-board-potential-conflicts-2012-5It Looks Like Some Chesapeake Energy Board Members Had Potential Conflicts Of Interest (CHK)http://www.businessinsider.com/bloomberg-chesapeake-board-potential-conflicts-2012-5
Mon, 21 May 2012 08:24:00 -0400Rob Wile
<p><img style="float:right;" src="http://static1.businessinsider.com/image/4f9eca57ecad04314700001a/kate-upton-aubrey-mcclendon.jpg" border="0" alt="kate upton aubrey mcclendon" /></p><p>The piling-on continues for Chesapeake Energy, which is still dealing with its <a href="http://www.businessinsider.com/category/aubrey-mcclendon">CEO's complicated compensation </a>situation and <a href="http://www.businessinsider.com/phil-weiss-argus-chesapeakes-10q--2012-5">other operational problems</a>.</p>
<p>This morning,<a href="http://www.bloomberg.com/news/2012-05-21/chesapeake-director-s-firm-paid-343-million-amid-ties.html?source=email_rt_mc&amp;ifp=0"> Bloomberg goes director-by-directo</a>r through Chesapeake Energy's board highlighting various potential conflicts.&nbsp; Here's some of what they found:</p>
<ul>
<li>Pete Miller, lead director: Chesapeake has paid Miller's firm, National Oilwell Varco, &nbsp;more than $343 million since 2009</li>
<li>Frank Keating, director since 2003: son Chip was paid more than $250,000 for participating in the company's real estate deals</li>
<li>Burns Hargis: <span>Chesapeake has donated more than $10 million to Oklahoma State University, where Hargis serves as president</span></li>
<li><span>Breene Kerr, former board member: trusts benefiting Kerr's siblings received $6.39 million in 2007 for oil and gas royalty interests on more than 5,750 net mineral acres</span></li>
</ul>
<div><span style="line-height: 19px;">A Chesapeake spokesman denied any impropriety.<span></span></span></div>
<div><span style="line-height: 19px;"><span><br /></span></span></div>
<div><span style="line-height: 19px;"><span>&ldquo;Each of Chesapeake&rsquo;s directors has built a superb reputation based on impeccable credentials, independent judgment and unwavering integrity," said Michael Kehs, a company spokesman. "We take great pride in our board.&rdquo;</span></span></div>
<div><span style="line-height: 19px;"><span><br /></span></span></div>
<div><span style="line-height: 19px;"><span><a href="http://www.bloomberg.com/news/2012-05-21/chesapeake-director-s-firm-paid-343-million-amid-ties.html?source=email_rt_mc&amp;ifp=0"><em>Read the full report on Bloomberg.</em></a></span></span></div>
<div><span style="line-height: 19px;"><span><br /></span></span></div>
<div><strong><span style="line-height: 19px;">SEE MORE: <a href="http://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=1&amp;ved=0CFYQFjAA&amp;url=http%3A%2F%2Fwww.businessinsider.com%2Fthe-life-of-aubrey-mcclendon-2012-4&amp;ei=gi66T7zgCOfN6QH2y-j0Cg&amp;usg=AFQjCNEOrr-wix-tAfdLrr3dCDXqXNqz2Q&amp;sig2=_gBgFFo3SIi2wMzdmvY6Bw">The Fabulous Life of Aubrey McClendon</a></span></strong></div><p><a href="http://www.businessinsider.com/bloomberg-chesapeake-board-potential-conflicts-2012-5#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/phil-weiss-argus-chesapeakes-10q--2012-5This Analyst Totally Predicted Chesapeake's 10-Q Bombshellhttp://www.businessinsider.com/phil-weiss-argus-chesapeakes-10q--2012-5
Fri, 11 May 2012 18:19:11 -0400Rob Wile
<p><img style="float:right;" src="http://static2.businessinsider.com/image/4fad87f26bb3f7f65700001a/phil-weiss.png" border="0" alt="phil weiss" /></p><p>Argus Research's <a href="http://www.businessinsider.com/argus-weiss-chesapeake-energy-2012-5">Phil Weiss</a> nailed the this afternoon's explosive reveal from Chesapeake Energy that cash and credit concerns have forced them to delay selling off some of their assets.</p>
<p><span>In their <a href="http://www.businessinsider.com/chesapeake-is-getting-destroyed-after-announcing-possible-asset-sale-delay-in-order-to-stay-in-compliance-with-loans-2012-5">10Q filing</a> today, Chesapeake said </span></p>
<p style="padding-left: 30px;"><span><span><span><span>"While asset monetizations enhance our liquidity, sales of producing natural gas and oil properties adversely affect the amount of cash flow we generate and reduce the amount and value of collateral available to secure our obligations, both of which are exacerbated by low natural gas prices..<span>As a result, we may delay one or more of our currently planned asset monetizations, or select other assets for monetization...</span>"</span></span></span></span></p>
<p>In his <a href="http://www.businessinsider.com/argus-weiss-chesapeake-energy-2012-5">May 3</a> note, Weiss warned of just such an eventuality. &nbsp;</p>
<p style="padding-left: 30px;"><span>"We have also raised the question in the past as to&nbsp;</span><span>whether potential acquirers <strong>who recognized the company's weak&nbsp;</strong></span><strong>financial position could smell 'blood in the water,' making them&nbsp;less willing to meet management's expectations for sales proceeds.&nbsp;</strong></p>
<p><span></span>...</p>
<p style="padding-left: 30px;">"We believe that&nbsp;management needs to recognize that its view of both natural gas&nbsp;and natural gas liquids prices may be too optimistic and that <strong>it may&nbsp;not be as easy to raise the necessary cash via asset sales as it has&nbsp;been in the past</strong>. Despite claiming on multiple occasions that it&nbsp;believes the land grab is over and that it is time to enter&nbsp;'manufacturing mode,' CHK continues to outspend peers for&nbsp;leaseholds. We think it needs to quench its insatiable desire to add&nbsp;acreage and slow spending to more moderate levels in order to&nbsp;protect its financial viability.<strong>"</strong></p>
<p>Weiss was <a href="http://excellence.thomsonreuters.com/media/1518626/2009_us.pdf">named the No. 2 stock picker in the country</a> by <a class="hidden_link" href="http://www.businessinsider.com/blackboard/reuters">Reuters</a> in 2009, so we can't say we're that surprised he called it.</p>
<p>Still, Bravo. &nbsp;&nbsp;</p><p><a href="http://www.businessinsider.com/phil-weiss-argus-chesapeakes-10q--2012-5#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/cramer-chesapeake-energy-cancer-it-is-2012-5CRAMER: The Board Needs To Treat Chesapeake Energy 'Like The Cancer It Is' (CHK)http://www.businessinsider.com/cramer-chesapeake-energy-cancer-it-is-2012-5
Fri, 11 May 2012 14:39:00 -0400Rob Wile
<p><img style="float:right;" src="http://static4.businessinsider.com/image/4f87415369bedd1135000002/jim-cramer.png" border="0" alt="Jim Cramer" /></p><p>Jim Cramer believes Chesapeake Energy's board needs to address CEO <a href="http://www.businessinsider.com/category/aubrey-mcclendon">Aubrey McClendon's</a> purported conflicts of interest much more aggressively.</p>
<p><a href="http://www.thestreet.com/video/11531616/cramer-i-want-the-board-to-treat-chesapeake-energy-like-the-cancer-it-is.html?CM_VEN=AD">In an interview with The Street</a>, Cramer said Chesapeake's board needs to appoint an independent investigative body.</p>
<p style="padding-left: 30px;">"What I would do if I were the board is I would say, 'Listen, we're turning this over to this law firm or special committee of directors that are just going to be on this,' and say 'we're going to get to the bottom of this and treat it like the cancer it is.' "</p>
<p><a href="http://www.businessinsider.com/chesapeake-ceo-denies-using-chesapeake-as-collateral-for-personal-loans-is-material-to-chesapeake-2012-4">Recent reports</a> of McClendon's transactions that involved personal well stakes led to&nbsp;his getting stripped of his chairmanship.</p>
<p>Cramer also said Chesapeake should begin selling off assets to resolve its debt issues. The <a class="hidden_link" href="http://www.businessinsider.com/blackboard/wall-street-journal">Wall Street Journal</a> <a href="http://www.businessinsider.com/report-chesapeake-14-billion-off-balance-sheet-debt-2012-5">reported this week</a> that the country's second-largest natural gas producer had $1.4 billion in off-balance-sheet debt.&nbsp;</p>
<p>"I think the Koreans and the Chinese want it," he said. "I think that can save Chesapeake."</p><p><a href="http://www.businessinsider.com/cramer-chesapeake-energy-cancer-it-is-2012-5#comments">Join the conversation about this story &#187;</a></p>